The new policy, aimed at giving owners incentives to preserve older houses and creating new housing by allowing additional rental or stratified units on their property, is one that many critics fear would not do much to provide real relief.

Vancouver residents who own older homes may soon get the right, for the first time, to build and sell an infill house in their backyards.

Mayor Gregor Robertson announced the proposed policy on Thursday as one of several measures planners have suggested to increase the amount of lower-cost housing in Vancouver as the city scrambles to alleviate the pressure caused by skyrocketing real estate prices.

But the new policy, aimed at giving owners incentives to preserve older houses and creating new housing by allowing additional rental or stratified units on their property, is one that many critics fear would not do much to provide real relief.

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"This just doesn't go far enough," said Adrian Crook, a tech entrepreneur who is involved with a volunteer advocacy group called Abundant Housing Vancouver. It is pushing for more inexpensive housing.

People in his group and other advocates say the new policy would allow only the most expensive kind of additional housing in the city's huge swaths of single-family zones.

AH Vancouver members would have preferred to see the city take the bolder step of allowing small apartment buildings in single-family zones, Mr. Crook said.

The new infill houses, which would be larger than the currently permitted laneway houses, would likely go on the market for about $1-million, even in Eastside neighbourhoods.

And if they were rented, the cost would likely be $2,000 a month or higher – an amount that is considered affordable, by standard definitions, only for people whose household income is $80,000 or more.

Mr. Robertson and city planners say the city's emerging new housing policies are aimed at ensuring that a hefty proportion of new construction is geared to households with incomes of $30,000 to $80,000.

"We are doing everything we can to deal with a market that has run away from many Vancouverites," the mayor said as he and his team stood outside a laneway house behind a pre-1930s home on a property valued at $5.6-million in the city's upscale Mackenzie Heights neighbourhood.

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To achieve affordable housing for people at the lowest end, the city would need new units that rent for only $750 a month.

Mr. Crook also noted that the new infills or in-house suites would be limited to about 12,000 lots with pre-1940s houses.

"That leaves out the majority of the houses in Vancouver," he said.

Councillor George Affleck, a member of the Non Partisan Association party, which has traditionally opposed Mr. Robertson's Vision Vancouver, said he is supporting the proposed policy, but doubts how much change it would really bring.

"I will be interested to see if this is successful, but I am skeptical it will do what we want it to do."

He also said he doubted it would slow the rate of demolitions of older houses in Vancouver.

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Mr. Robertson's party and city planners have been scrambling over the past two years to bring in new housing initiatives aimed at controlling demand and increasing supply, as both property prices and rents have risen at startling rates and public anger has grown.

The city has introduced a vacancy tax that will penalize owners of homes that are left empty or used as part-time second homes. Owners will start paying that tax as of next year if they have not rented out those units for at least six months of this year.

City council has also approved new regulations to restrict short-term vacation rentals, allowing them only in homes where residents live more or less full-time, which will come into effect next April.

Now, planners are rolling out new policies in the next weeks that are intended to encourage new kinds of supply.

They have made the case that Vancouver is seeing a huge amount of construction, but too little of it is geared to the incomes of working city residents.

To push developers into building different kinds of housing, planners have been looking at potential new mechanisms to encourage more dedicated rental housing, more rental housing at rates affordable to lower-income people and more development around transit stations, among other things.